CAG report Himachal: 40,000+ illegal mining cases, Rs 61 crore SDRF funds withheld, Rs 254 crore NDRF delayed
Shimla March 30,
CAG report on Himachal Pradesh exposes over 40,000 illegal mining cases, Rs 61 crore SDRF funds withheld and Rs 254 crore NDRF delayed, raising serious concerns over governance and financial management.
At a time when Himachal Pradesh is grappling with rising debt and fiscal stress, the latest Compliance Audit Report of the Comptroller and Auditor General (CAG) has flagged serious governance failures across key sectors, including mining regulation and disaster fund management, exposing large-scale irregularities, revenue leakages and systemic inefficiencies.
The report reveals that over 40,000 cases of illegal or unauthorised mining were detected between 2018-19 and 2022-23, with more than 8,000 cases recorded in 2022-23 alone, pointing to weak enforcement and regulatory failure in the mining sector. Despite statutory requirements, the state failed to operationalise key mechanisms such as a Central Flying Squad, GPS-based tracking of mineral transport and Mining Surveillance Systems, while district-level task forces were not constituted and key posts remained vacant.
The audit further highlights revenue losses due to poor monitoring. By comparing electricity consumption-based production data with royalty receipts across 71 leases in three districts, the CAG found a short realisation of Rs 1.81 crore in 27 leases, along with additional dues of Rs 74.81 lakh in dead rent and interest and Rs 7.27 lakh in surface rent remaining unrealised due to delayed action.
Serious irregularities were also found on the ground. In a sample check of mining sites, permanent boundary demarcation was missing in a majority of locations, while excavation was found extending beyond approved lease areas. In six cases, extraction was carried out outside sanctioned coordinates, raising concerns over both environmental compliance and revenue protection.
Also read:Himachal debt burden crosses Rs 1 lakh crore mark, CAG flags rising liabilities
The audit also exposes inefficiencies in the utilisation of District Mineral Foundation Trust (DMFT) funds. Out of Rs 239.21 crore received, only Rs 86.56 crore (36.18%) was sanctioned, and just Rs 47.03 crore (19.66%) was actually released, indicating poor fund utilisation. Of 261 projects meant for execution, only 51 works (20%) were completed, while 80% remained incomplete, reflecting serious implementation gaps.
Parallel concerns have been raised in disaster fund management, where the report points to repeated misuse and poor financial discipline. The CAG noted that the Central Government withheld Rs 61.07 crore out of Rs 258.30 crore of SDRF allocation in 2019-20 due to persistent misutilisation, a trend that continued in subsequent years.
Further, Rs 254.73 crore sanctioned under the National Disaster Response Fund (NDRF) during 2020-22 was not released, primarily due to high unspent balances in the State Disaster Response Fund, which itself resulted from poor fund management and accounting lapses. This led to delays of one to two years in disaster relief assistance, directly impacting response timelines.
The audit also found that Rs 122.27 crore of disaster funds were kept in savings accounts instead of approved investment instruments, resulting in loss of potential interest income, while inadmissible works worth Rs 11.76 crore were undertaken, diverting funds meant strictly for disaster relief.
In addition, delays ranging from 11 to 33 months were recorded in the sanction of relief cases, and significant gaps were observed in disaster preparedness, including understaffed response forces, unutilised funds, and lack of updated disaster management plans.
The findings collectively point towards systemic shortcomings in planning, enforcement and financial management, while hiking concerns about governance standards at a time when the state is already facing financial pressure. The CAG has recommended strengthening monitoring mechanisms, ensuring timely recovery of dues, improving fund utilisation and enforcing accountability across departments to prevent further financial and administrative lapses.
About the Author
The HimachalScape Bureau comprises seasoned journalists from Himachal Pradesh with over 25 years of experience in leading media conglomerates such as The Times of India and United News of India. Known for their in-depth regional insights, the team brings credible, research-driven, and balanced reportage on Himachal’s socio-political and developmental landscape.
